This AC stock will save from the heat of the market, can you give strong returns in the summer season

The Indian Meteorological Department (IMD) has issued a warning of higher temperature and heat stroke in the summer season this year. This is not new, because the temperature is already increasing in India. Due to this, cooling products like air conditioner (AC), coolers and wings are expected to be sold this year.

In this situation, companies working in the cooling segment will benefit, especially market leaders Voltas. An interesting thing is that the shares of the consumer durables sector accelerate before the summer season. Will this happen this time too? Let’s know the company’s condition and future possibilities.

Voltas market

The company of Voltas Tata Group works in three main business segments, including unity products (UPBG). This segment room sells air conditioner, air and water coolers and commercial refrigeration products. Voltas have 20.5 percent market share in the AC market. The refrigerator has 5.1 per cent market share, 8.3 per cent in washing machine and 16.7 per cent in semi-automatic washing machine. The UPBG segment contributes 63 percent to the company’s total revenue.

Last year, Voltas sold more than 2 million AC units, which is the company’s largest record ever. Apart from this, good growth was also seen in air coolers and commercial refrigeration products.

future plans

Voltas plans to launch new products in view of demand in the summer season. The company has fixed a 5 billion capital experience for compressor manufacturing. A new AC facility is being created in Chennai, which will start working with this heat. Voltas Beko is increasing its distribution network and focusing on e-commerce sales.

Rowse in share price

The share of Voltas has risen 11 percent in the last one month, which is reversed by the market trend. Voltas have a strong hold in the AC market and its revenue and profit are expected to increase due to increase in demand during the summer season. However, investors should pay attention to the level of the company’s return ratio (ROE 4.4 per cent, ROCE 8.5 per cent) and pre-coved profit.

Disclaimer: (The information provided here is being given only for information. It is necessary to tell here that the investment in the market is subject to risks. Always consult expert before investing as an investor. Abplive.com is never advised to invest money here.)

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